What went wrong at DisneyQuest?

Robert K.Elder, Tribune staff writerCHICAGO TRIBUNE

In a glitzy, state-of-the-art facility on prime real estate in downtown Chicago -- and with a brand name and concept that was on the cutting edge of technology -- DisneyQuest seemed to have it all in terms of modern entertainment. So the recent announcement that it would roll up its virtual reality magic carpets in September came as a jarring reality check on such high-tech ventures.

But apart from some spectacular marketing and business miscalculations, the failure of DisneyQuest also brings into focus the whole issue of family entertainment -- what works and what doesn't and how far technology can go to make it a success. In the end, DisneyQuest proves that some principles of family entertainment are impervious to technology, even patently old-fashioned -- things like variety, convenience, parking, the demands of age ranges and tastes, even good food and comfortable surroundings.

"It's important that you have something that the entire family can do," says Gary Slade, publisher and editor-in-chief of Amusement Today, a monthly trade newspaper covering the amusement and water park industry.

"Disney is always looking for opportunities for growth, and we feel proud that we did a very good job at DisneyQuest, and people loved it, but it was a test," says Disney spokeswoman Leslie Ferraro. Although DisneyQuest was not losing money, Ferraro says, it didn't live up to Disney's expected returns.

Meanwhile, some entertainment companies similar to DisneyQuest, which do not have entry fees, have already modified their offerings to have broader family appeal.

The national chain GameWorks, for example, which caters to an older crowd than DisneyQuest but has a similar business model, has become "less game-centric" and more of an all-encompassing family entertainment center, says president and CEO Ron Bension of the 6-year-old company.

"In the last two years, [GameWorks] has evolved into a full-service entertainment complex with great food and excellent games that are fun to play. We do almost 50 percent of our revenues from food and beverage," Bension says. "You have to attract a wide demographic."

Dave & Busters, which has 30 locations nationwide including Chicago-area branches at 1030 N. Clark St. and in Addison, has also been ahead of the curve, avoiding the narrow marketing tactic that caused the DisneyQuest titanic.

While old-time arcades used to be part of a larger venue (a boardwalk, a shopping mall), home gaming systems such as Nintendo and Sony PlayStation made the classic arcade almost extinct.

Adopting more traditional values

Now "location-based entertainment" experiences, or LBEs as they call themselves, are adopting more traditional entertainment values. The businesses have added full-service dining, movies, bowling alleys and other cross-demographic family activities to some locations.

Ron Paul, of the Chicago consulting and researching firm Technomic Inc., says the closure of DisneyQuest shouldn't reflect badly on the future of high-tech interactive gaming as a whole.

"All it says is that kind of venue at that price point is a very risky venture," Paul says. "Chicago is not Las Vegas, and it isn't Orlando. You've got to have tremendous tourism and traffic to make these kind of businesses work."

The theme park model may have also worked against DisneyQuest's success, says Paul. DisneyQuest lowered its adult admission last fall from $34 to $26. A $10 Discovery Pass also allowed patrons to add credits for attractions as they went. But both moves may have been too little, too late.

"You're setting up a barrier by having a single price," Paul says. "You're not letting the customer pick and choose what the want to buy."

"At Disney, everything is not just the gold standard, it's the platinum standard. We're not willing to do something if it's not the best," Disney's Ferraro says. "The technology there was absolutely cutting edge, with a stream of new attractions, and that doesn't come inexpensively. That's not to say someone who isn't Disney couldn't do it in a different way."

Long lines, high prices

In the end, with DisneyQuest, there were long lines and high prices, and although kids may have loved attractions such as Aladdin's Magic Carpet Ride and CyberSpace Mountain, adults were left with little do to. Industry experts also say that too many of the virtual reality games didn't allow for family interaction.

Still, some patrons we caught off-guard by Disney's announcement.

"We probably wouldn't have come [to Chicago] if it hadn't been for Disney," says Max Baker, 43, who was traveling with a friend with four kids from Columbus, Ohio.

"Oh, man, that stinks; it was one of the best things about coming to Chicago," says his crestfallen daughter Amanda, 12, after raving about DisneyQuest's new Pirates of the Caribbean attraction.

However, Baker says his recent weekday afternoon trip was better than some previous experiences in DisneyQuest, which were "slow, crowded and disorganized."

Grandmother Jorene Cicero, 58, echoes Baker's comments. While her grandchildren loved the games, parking and crowds often detracted from an increasingly expensive trip from Elmwood Park.

Consumer behavior is a slippery science, especially when predicting what entertainment will captivate future generations.

DisneyQuest had its mix of virtual reality and interactive games, but it ultimately misread the market.

"Virtual reality gaming in my lifetime will never, ever succeed on a mass scale. It's really an individualized experience, and so there's no group fun to it," says GameWorks' Bension. "When you make it too difficult to have fun, which virtual reality does, then it's no longer fun, it's work. It's clearly not enjoyable to watch."

Good future for family games

Dave & Busters co-founder and president Dave Corriveau also sees a positive future for interactive games, from pool to multiple-player race car driving--as long as it involves the whole family.

"The public is playing games up until a certain point, when the games become so complicated or expensive, you'll see some resistance," he says.

"We've seen a decline in the last year to year-and-a-half in some of the big theme parks in their attendance," Slade says. "Some of the parks have realized that they are borderline too expensive for a family of four to go to."